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Climate Change, Irrigation and Pests: Examining Heliothis in the Murray Darling Basin

  • David Adamson


    (Risk and Sustainable Management Group, University of Queensland)

Helicoverpa spp. (heliothis) are a major insect pest of cotton, grains and horticulture in the Murray‐ Darling Basin. Climate change is likely to make conditions more favourable for heliothis. This could cause regional comparative advantages in irrigation systems to change as management costs increase and yields decrease. Irrigation in the Murray Darling Basin produces 12 percent of Australia’s total gross value of agricultural production. If producers fail to consider climate change impacts on heliothis they may misallocate resources.Adamson et al. (2007 and 2009) have used a state contingent approach to risk and uncertainty to illustrate how producers could allocate irrigation resources based on climate change impacts on water resources. This is achieved by separating environmental risks and uncertainties into defined states of nature to which the decision makers have a set of defined responses. This approach assumes that the decision makers can achieve optimal allocation of resources as they have perfect knowledge in how they should respond to each state of nature (i.e. producers know how to manage heliothis now). Climate change brings a set of new conditions for which existing state parameters (mean and variance) will alter. Consequently a decision maker will have incomplete information about the state description; and the relationship between state allocable inputs and the associated state dependent output, until they have experienced all possible outcomes. Therefore if producers ignore climate changes to heliothis they may lock in resources that may prove to be unprofitable in the long run. The purpose of this paper is to suggest a framework that could be used for determining climate change impacts of heliothis (i.e. density), illustrate that management costs rise as density increases and how a stochastic function could deal with incomplete knowledge in a state contingent framework.

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Paper provided by Risk and Sustainable Management Group, University of Queensland in its series Murray-Darling Program Working Papers with number WP1M10.

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Date of creation: Nov 2010
Date of revision:
Handle: RePEc:rsm:murray:m10_1
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  1. John Quiggin, . "Declining inflows and more frequent droughts in the Murray–Darling Basin: climate change, impacts and adaption," Climate Change Working Papers WPC07_2, Risk and Sustainable Management Group, University of Queensland.
  2. Adamson, David & Mallawaarachchi, Thilak & Quiggin, John, 2006. "Water use and salinity in the Murray-Darling Basin: a state contingent model," Risk and Sustainable Management Group Working Papers 149861, University of Queensland, School of Economics.
  3. David Adamson & David Cook, 2007. "Re-examining economic options for import risk assessments," Murray-Darling Program Working Papers WP3M07, Risk and Sustainable Management Group, University of Queensland.
  4. Jean-Paul Chavas, 2008. "A Cost Approach to Economic Analysis Under State-Contingent Production Uncertainty," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(2), pages 435-466.
  5. C. J. O'Donnell & W. E. Griffiths, 2006. "Estimating State-Contingent Production Frontiers," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(1), pages 249-266.
  6. Robert G. Chambers & John Quiggin, 2002. "The State-Contingent Properties of Stochastic Production Functions," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(2), pages 513-526.
  7. Davis, Robert M. & Skold, Melvin D. & Berry, James S. & Kemp, William P., 1992. "The Economic Threshold For Grasshopper Control On Public Rangelands," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 17(01), July.
  8. Ramanan Laxminarayan & R. Simpson, 2002. "Refuge Strategies for Managing Pest Resistance in Transgenic Agriculture," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 22(4), pages 521-536, August.
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